Publicis Groupe Posts 'Moderate' 2013 Organic Growth
Publicis Groupe fourth-quarter revenues grew 1.5% to approximately $2.6 billion, but organic growth for the period -- which excludes the impact of acquisitions, divestitures and currency fluctuations -- was a tepid 0.7%.
By comparison, proposed merger partner Omnicom Group reported earlier this week that it achieved 4.2% organic growth for the fourth quarter and 2.9% overall revenue growth to $3.94 billion.
Publicis Groupe CEO Maurice Levy had signaled a few weeks ago that the company’s fourth-quarter results would show some “weakness” versus the rest of 2013.
In a statement today, Levy said the company’s Q4 organic growth “was affected by campaigns being cancelled or postponed, particularly in the emerging markets. Our client portfolio, outweighed in the luxury sector, undoubtedly caused us to have a greater exposure than the market.”
The company also said that Q4 organic growth was “adversely effected” by Europe’s struggling economy, as well as the slowdown in some emerging economies, including China.
Levy described the dip in Q4 organic growth as a “one-time blip” that “does not call into question our growth plan particularly for 2014.”
Levy also stated that the “merger project is “progressing steadily.” In a call with analysts earlier in the week, Omnicom CEO John Wren noted that completion of the merger would now likely be delayed until the third quarter of 2014. Previously, the companies had hoped to have it done by mid-year.
Fourth quarter aside, Levy described Publicis Groupe’s overall performance in 2013 as “outstanding,” with what he termed “moderate” full-year organic growth of 2.6%. Omnicom, by comparison, had full-year 2013 organic growth of 3.5%.
For the full year, Publicis Groupe posted an 8.7% increase in overall revenues to $9.23 billion. The company said net income was up 11.5%, but that excludes 38 million Euros in pre-tax merger-related costs. The company didn’t state in its financial release what its net income growth rate was, with the merger costs factored in.